Could be good for company moving forward. You cannot debt that this company had a lot of baggage that bankruptcy is going to clear out. Maybe without costs of closed store leases etc the Ebita positive stores will be able to move forward.
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Most commercial leases have an out. The out is usually 6 months to one years rent. So even if a store closes that was leased then SHC is still on the hook for at least six months rent after closing. This does not include any repairs and fixes that the lease may stipulate. Chapter 7 coming after Christmas.
Actually lease costs are preserved in a bankruptcy; especially cure amounts.
It is quite common for a landlord to claim large cure amounts while a filers lawyers claim they owe nothing and claim a lease should be discharged.
When a store is closed it is commonly a requirement that it be left in at least as good a condition as when the lease commenced. Sears may c;laim it put on a new roof with the best materials and skilled contractors; while a landlord claims it had a dilapidated roof that caved on the 1rst rainfall and damaged a million dollars worth of a clients goods.
I may be wrong here; but I believe even if a judge dismisses a landlords claim; that as long as the landlord has papers showing his lease was uncured he can appeal over-and-over again because his evidence is sound; and the law is clear regarding lease cures. That is to say the law is on the landlord's side with respect to cures. The landlord may settle for less than owed; but I don't think he can be forced out of an agreement without having the ability to appeal.
Even if all of the debt is forgiven the stores are in terrible shape and the brand is badly damaged. No way out of this one.
My god, still people on here hoping for the transformation to finish!
Actually it DOESN'T.
@gst, actually bankruptcy allows companies to break leases.
Those leases don't magically disappear. They are still liable for either all, a portion of the term, or face penalties.
There IS no "way forward" other than liquidation.
Wake the eff up and smell the coffee.